In a startling attack yesterday, North Korea bombarded a South Korean island, killing 2 Marines and 2 civilians, raising significant fears of a war. Unlike their previous provocations, this was a direct attack on South Korean soil, and may cause the South to retaliate directly. On the other hand, the sinking of a South Korean warship with the death of 46 crewmen by most presumably, North Korea didn't cause war to break out so if the North backs down then maybe Seoul will not try to push things. This is unfortunate because North Korea seems to have this trend of making threats and carrying out provocations a lot, whether to get attention or aid. Even worse, is that in the past they've carried out much deadlier attacks, even on civilian targets, and Seoul and the West have been reluctant to do much. The North is a true rogue regime, that doesn't care about other countries or its own people, and it's very unfortunate that it has remained in power until now.

South Korea finally came out and stated what seemed to be quite obvious, that the North torpedoed and sank their warship 2 months ago. Now, South Korea is going to take the case to the U.N. and try to take hard action against the North such as imposing unilateral sanctions. The hard part is, that short of some sort of military action or declaring war, there is nothing much the South can do. North Korea is already in such a wretched state, being one of the most isolated nations, if not the most, in the world and it's led by a regime headed by a dictator who doesn't seem to give a damn about his people's welfare. Another factor constricting the South is the North's patron China is very reluctant to accede to any strong actions against Pyongyang. This apparently perplexes the South who feel that their relations with China have been improving, but for Beijing, they probably see the North as being one of the few nations who will side with them no matter what and even upholding good relations with the South, who are an American ally, won't be enough to change that.
However, if China wants to maintain or build up its status as a world power, they need to step up geopolitically and exercise leadership in matters that aren't just about economics and trade such as this crisis between two of their closest neighbors.

One of the biggest stories of late is North Korea's continuous saber-rattling, or should it be missile-rattling, provocations that have raised tensions in neighboring countries, even supposed ally China and the U.S. Its recent sentencing of 2 U.S. journalists to 12 years for spying because they were caught doing a story just within North Korean territory seems tremendously daring, like if they're daring the U.S. to fight. It might be a sign of desperation, especially with South Korea's refusal to be taken advantage of by them in recent years and with the leader's poor health including an alleged stroke. One thing, is that this is one of the worst, if not the, and most unjust regimes in the world. Asia Times has a whole bunch of insightful articles here.
To be honest, one wonders if the best thing the rest of the world can do is call the North's bluff and wait for Pyongyang to actually start a war. The South's military superiority along with American support and possibly Japan as well, would easily defeat North Korea and cause an overthrow of their regime.